Dell International Services India Pvt. Ltd. Vs DCIT (ITAT Bangalore)
n the case of Dell International Services India Pvt. Ltd., the Bangalore ITAT held that GST, sales tax, and service tax refunds cannot be taxed where the assessee consistently follows the exclusive method of accounting and does not route such taxes through the Profit & Loss Account. The Tribunal clarified that since these taxes were neither claimed as expenditure nor debited to P&L, their refund cannot be treated as income—rejecting the CIT(A)’s view of taxability under Section 41(1) or Section 28(i).
Further, the ITAT deleted the addition of ₹14.37 crore relating to margin on stock converted into capital assets, holding that the amount was already offered to tax in the return, and a second addition under Section 143(1) would amount to double taxation.
On interest under Sections 234B and 234C, the Tribunal held it to be consequential, directing recomputation.
Accordingly, the appeals were allowed (partly/statistical purposes), granting substantive relief on key additions.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
These appeals at the instance of the assessee are directed against the separate orders of the ld.Addl/JCIT(A)-2, Mumbai both dated 11.11.2025 vide DIN & Order No: ITBA/APL/S/250/2025-26/1082483582(1) for the AY 2023-24 & vide DIN & Order No. ITBA/APL/S/250/2025-26/1082483853(1) for the AY 2024-25 passed u/s. 250 of the Income Tax Act, 1961 (in short “theAct”). Since the issue in both appeals is common, these are clubbed together, heard together and disposed of by this common order for the sake of convenience.
